surrender value
TRANSCRIPT
Surrender value
Surrender value Surrender value is the sum of money an
insurance company will pay to the policyholder or annuity holder in the event of his policy being voluntarily terminated before its maturity or the insured event occurring. This cash value is the savings component of
most permanent life insurance policies, particularly whole life insurance policies. This is also known as 'cash value', 'surrender
value' and 'policyholder's equity'
Surrender value Surrender value is the amount payable to the
policyholder should he decide to discontinue the policy and encash it. It is payable only after three full years'
premiums have been paid to the insurance company. Moreover, if it is a participating policy, the
bonus gets attached to it. Surrender of policy is not recommended since
the surrender value will always be proportionately lower.
Surrender value Surrender value is what an insurance company
will pay an insured, after charges are deducted, if he terminates or surrenders the policy before the original maturity date. The life cover provided by a life insurance
policy ends with its surrender as it effects a termination of the contract between the insured and the insurer. On surrender, the insured basically gets the
fund value of his investments minus the charges that the insurer levies on account of premature termination.
Documents Required during surrender of policy
Original policy certificatePhotocopy of premium payment receiptsPhotocopy of latest unit balance (for ULIPs)Application for surrender value (S.V.
Application) or LIC Surrender Request LetterLIC Form No. 3510/5074
Steps to be followFill-in the above forms and affix the
revenue stamp2. Submit the application in your
LIC office. You can only surrender your policy in the
office where the policy is issued. You can find your policy issuing office in
policy certificate or premium receipts.
Important points Only policy holder can surrender the policy.After verification of your policy details the LIC officer will issue you an acknowledgment receipt. Take the acknowledgement slip for your surrendered policies.Once surrendered it would take approximately 20-30 days for you to receive the check at your address.Surrender value cheque will only be sent to the address on your policy. If the address is not your current address, you may get it updated by giving address change request form. The address change will be done immediately and you will be given an acknowledgement.
Keep in mind while surrendering
Surrender value is payable only after three full annual premiums are paid to LIC.Surrender of policy is not recommended since
the surrender value would always be proportionately low.Should you decide to go in for another
insurance at this stage further insurance would be available to you at a much higher premium because your age would have advanced since taking out the earlier policy.
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